BILL ANALYSIS Ó
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THIRD READING
Bill No: AB 1494
Author: Assembly Budget Committee
Amended: 6/25/12 in Senate
Vote: 21
SENATE BUDGET & FISCAL REVIEW COMMITTEE : 9-2, 6/25/12
AYES: Leno, Alquist, DeSaulnier, Hancock, Liu, Lowenthal,
Negrete McLeod, Wolk, Wright
NOES: Anderson, La Malfa
NO VOTE RECORDED: Emmerson, Evans, Fuller, Gaines,
Simitian
ASSEMBLY FLOOR : Not relevant
SUBJECT : Healthy Families Program Budget Trailer Bill
SOURCE : Author
DIGEST : This bill transitions children in the Healthy
Families Program to the Medi-Cal program beginning January
1, 2013. This transition achieves $13.1 million General
Fund savings in 2012-13, $58.4 million in 2013-14, and
$72.9 million in 2014-15.
ANALYSIS : This bill also reduces rates for laboratory
services in the Medi-Cal program and rescinds prior Senate
action on the funding source for certain California
Children's Services therapies. Specifically, this bill:
1. Healthy Families Program Transition to Medi-Cal.
CONTINUED
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Transitions approximately 880,000 children from the
Healthy Families Program (HFP) to the Medi-Cal program
beginning January 1, 2013.
A. Transition Phases. Provides that the transition
occur in four phases:
Phase 1 - Begins January 1, 2013, and
includes about 415,000 children in an HFP health
plan that matches a Medi-Cal health plan.
Phase 2 - Begins April 1, 2013, and
includes about 249,000 children in an HFP health
plan that is a subcontractor of a Medi-Cal managed
care health plan.
Phase 3 - Begins August 1, 2013, and
transitions about 173,000 children enrolled in an
HFP plan that is not a Medi-Cal managed care plan
and does not contract or subcontract with a
Medi-Cal managed care plan into a Medi-Cal managed
care plan in that county.
Phase 4 - Begins no earlier than September
1, 2013, and transitions about 43,000 children in
HFP residing in a county that is not Medi-Cal
managed care into the Medi-Cal fee-for-service
delivery system.
B. Transition Plan. Requires the California Health
and Human Services Agency to work with the Managed
Risk Medical Insurance Board, the Department of
Health Care Services (DHCS), and the Department of
Managed Health Care to develop a transition plan for
this transition of children from HFP to Medi-Cal no
later than October 1, 2012. This plan shall include
at least the following information:
State, county, and local administrative
activities that will facilitate a successful
transition.
Methods and processes for stakeholder
engagement to assist in the transition.
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State monitoring of managed care health
plans' performance and accountability for
provision of services.
Also requires the Administration to convene a
stakeholder workgroup process for preparation and
transition, as well as to have ongoing meetings
during the phases.
C. Implementation Plans . Requires DHCS to submit an
implementation plan for each phase prior to
transitioning children to Medi-Cal to ensure
continuity of care with the goal of ensuring there is
no interruption in services and there is continued
access to coverage for transitioning individuals.
Requires DHCS to consult with stakeholders on the
development of the implementation plans.
D. Readiness Requirements . Specifies requirements
that must be in place prior to implementation of
phase 1, such that Medi-Cal managed care plan
performance measures shall be integrated and
coordinated with the HFP performance standards.
Requires the Department of Managed Health Care (DMHC)
to verify health plan and network readiness prior to
any transition.
E. Monitoring of Transition . Requires monthly status
reports on the transition to be submitted to the
Legislature. These reports must include, but not be
limited to, information on health plan grievances
related to access to care, continuity of care
requests and outcomes, changes to provider networks
(including provider enrollment and disenrollment).
F. Dental Coverage . For Sacramento and Los Angeles
counties, requires that dental coverage for
individuals transferring continue to be provided by
their current dental managed care plan if the HFP
dental plan is a Medi-Cal dental managed care plan.
For Sacramento County, if their plan is not a
Medi-Cal dental managed care plan, the individual
shall be assigned to a plan with preference to a plan
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with which their current provider is a contracted
provider. For Los Angeles County, if their plan is
not a Medi-Cal dental managed care plan, the
individual may select a Medi-Cal dental managed care
plan or choose to move into Medi-Cal fee-for-service
dental coverage. For all other counties, dental
coverage for these children would transition to
Medi-Cal fee-for-service dental coverage.
G. County Eligibility Determinations . Specifies
county performance standards with regard to county
eligibility determinations for individuals
transitioning from HFP to Medi-Cal.
H. Notification to Individuals Transitioning .
Ensures that individuals who are transitioning from
HFP to Medi-Cal are notified of this transition at
least 60 days prior to the Phase 1 transition and at
least 90 days prior to the Phase 2, 3, and 4
transitions.
I. DMHC - Consumer Assistance . This bill
appropriates $400,000 from the Managed Care Fund to
DMHC for administration of the call center to assist
individuals with the Healthy Families transition, and
health plan readiness and coordination functions with
DHCS.
2. Laboratory Rate Reduction. This bill provides DHCS
the authority to establish a reimbursement rate
methodology for setting Medi-Cal rates of reimbursement
for clinical lab services provided to Medi-Cal
beneficiaries. The proposed methodology would develop
rates that are based on the lowest amounts other payers
are paying for similar clinical laboratory services.
Until the implementation of the new methodology,
payments for clinical laboratory services would be
subject to an additional 10% provider payment reduction.
This bill exempts the Family Planning, Access, Care,
and Treatment (FPACT) program from the 10% rate
reduction. This achieves $7.7 million in General Fund
savings. (This proposal was originally included in AB
1467, the omnibus health trailer bill, but is amended in
this bill.)
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3. California Children's Services (CCS) Medical Therapy
Program. This bill rescinds the changes in AB 1467 (the
omnibus health trailer bill) which would have required
that all services assessed and determined as
educationally necessary by the Individualized Education
Program (IEP) team and contained in the child's IEP
shall be provided in accordance with the federal
Individuals with Disabilities Education Act (IDEA),
rather than the CCS program. This change would have
provided for $24.6 million in savings ($12.2 million
General Fund and $12.4 million county funds).
FISCAL EFFECT : Appropriation: Yes Fiscal Com.: Yes
Local: Yes
CTW:m 6/26/12 Senate Floor Analyses
SUPPORT/OPPOSITION: NONE RECEIVED
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